Small Market Winning – The Padres Need to Win Like the Rays

I have never fully been convinced that salary equals success.  Sure, it helps.  Sure, when spent properly, more salary can equal longer sustained success.  However, money isn’t the key to winning.  I analyzed this prior to my time here at Chicken Friars and would ask that you check it out because it leads into this piece.

The Tampa Bay rays, infused with new ownership and a new front office, have approached baseball, salary, and winning in a way never before seen in the game.  This is a different story than Moneyball and the A’s.  This is about using your brain as an owner and a GM.  It’s about embracing the fact that you will never have the money of a Yankees or a Red Sox or a Phillies team.  It’s about operating with what you have, controlling what you can, and being successful at it.  I highly recommend reading The Extra 2%.  It goes into all the details of how the Rays went from worst to first and intend to continue that trend.  I’ll focus on comparison of the Padres and the Rays.

Let’s first start with the definition of small-market.  The Padres and the Rays are both small-market clubs.  The Cardinals are a small-market club.  The Diamondbacks are a small-market club.  Payroll doesn’t define market size.  The available audience defines market size.  If the Yankees decided they were going to reduce payroll to $40 million a season, they would still not fall under the small-market category.  The Rays and the Padres have similar audiences and are both classified as small-market.

The Clearwater Metropolitan Statistical Area (encompassing Tampa Bay and St. Petersburg) has a population around 4.2 million.  The San Diego-Tijuana Metropolitan Area has a population of around 5.1 million.  As you can see, both are relatively close in size.  Now, these markets can draw from other areas of course, but for the purposes of market size we are focusing on the metropolitan areas.  The population sizes in these two markets clearly push Tampa Bay and San Diego into the small-market category.

These two teams also make for good comparisons because their ownership groups do not have bottom-less pockets.  They work on small budgets and must find ways to succeed without signing big-dollar players.  You’ll notice, the times the payrolls increase for these teams are after winning seasons, but the high payrolls cannot be sustained and ultimately dip back down.  For the Padres, their payroll increased after three straight winning seasons from 2005-2007.  However, when the 2008 team, with a higher than normal payroll, failed to win, the payroll dipped back down.  The Rays saw a jump in payroll after the 2008 and 2009 campaigns.  Yet when the Rays failed to advance to another World Series, the payroll dropped drastically for the 2011 season.

Below is a table showing both teams’ wins verse salary for the 2008-2011 seasons:

As you can see, the Rays and the Padres had very similar average payrolls, but the Padres average almost 18 less wins per season during this time frame.  Why?

The Rays have made a habit of winning through the draft, international scouting, and signing players to cheap long-term deals.  What they do differently, is buy low and sell high.  Rather than get attached to a player, not matter how great that player has performed, the Rays are always looking to trade for additional talent, additional draft picks, and more salary freedom.  Let’s take Matt Garza for example.

In three seasons with the Rays, Garza made a grand total of $4,187,900.  When Garza’s salary started increasing due to arbitration years and performance, the Rays traded him along with two other players, Zach Rosscup and Fernando Perez, for four players in return.  Garza promptly made $5,950,000 in his first year with the Cubs, more than all three years with the Rays combined.  The Rays will work to develop the talent the received in the trade and when the time comes, they will trade those players as well.  The same happened with Scott Kazmir.

In six seasons with the Rays, Kazmir made $10,897,000.  However, his salary was increasing very quickly on a per year basis.  The Rays traded Kazmir to the Angels in 2009 for three players including Sean Rodriguez who they may be looking to shop for even more return now.  Kazmir went on to make $20 million in his first two years in Los Angeles.

The Rays are making a habit out of evaluating a player’s cost verse benefit.  No matter how great the player performs, they will be traded if their salary doesn’t support the ultimate return.  The other thing the Rays weigh is what they can get in return and what they can turn those players into.  They show the foresight many other small-market clubs lack.  They have a predicitve analysis method that brings big returns on trades.

The Padres have never shown this ability.  Kevin Towers pulled off some great trades in his time, but never had the consistent foresight to trade talented, expensive players for draft picks and cheaper younger talent.  Jed Hoyer wasn’t here long enough to tell if he could change that.  Now, it is up to Josh Byrnes.

With a salary below league average, the Padres have no choice but to think outside the box and compete using their brains rather than their wallets.

For more on the Rays, be sure to check out Rays Colored Glasses.